Property managers take the burden from property owners with regard to the day-to-day operations of an investment or rental property. Property managers are responsible for various managerial tasks associated with the property. This includes anything from fielding calls about broken hot water tanks to staying on top of the many city, state & federal regulations that must be followed. A property manager can help with the following property management functions.
Allow for Investments Without Geographic Limitations
Successfully managing real estate requires a local presence. Hiring a property manager allows an investor to invest in a property regardless of the location of the property to the owner. This opens the door for investors to diversify while enabling the investor to maintain the property at an optimal level.
Respond to Maintenance Requests
Most property owners and managers recognize that maintenance requests create the most disruptions and difficulties in property management. Without a property manager, the property owner will likely question their choice of ‘passive’ income when trying to manage a flooded unit in the middle of the night.
Timely maintenance responses send a message to the renter that they are valued, which will likely lead to better care for the rental unit. Slow or non-responsive maintenance requests lead to renter turnover, which can be expensive.
Control Maintenance Expenses of the Rental Unit
Regular maintenance is an effective way to control current and future costs of property issues. A property manager can periodically inspect the property to determine if:
- There are needed repairs.
- The property’s renters are compliant with the terms of the lease.
Property managers can help document the issue by forwarding pictures of the damage and an itemized repair cost estimate. This documentation includes written proof and photographs of the repair.
Understand Relevant Laws & Regulations with Regard to Current Laws
Keeping on top of current laws can be overwhelming for investors, especially if these rental homes are in varied locations. It's crucial to partner with a property manager who stays updated on laws and regulations, as well as a maintain a relationship with a trusted attorney in case any legal issues arise.
Market the Investment Property to Fill Vacancies
Empty rental properties incur costs each day they remain vacant. A quality property manager can help reduce (or even eliminate) this potential expense by proactively renewing leases or marketing the property to fill vacancies when given notice by the current resident.
A well-maintained rental property, rented at market value, should attract quality renters with relative ease. A property manager can also help make the property ready to rent by re-keying the door and making necessary repairs. When the unit is ready to be shown, the property manager markets the property aggressively.
Screen Prospective Renters
A practical and thorough screening process is an intelligent way to reduce the property owner’s risk of potential financial losses. This includes credit, background, employee, and rental history checks, among others. A property manager can also help to ensure all business operations comply with discrimination and fair housing laws.
Collect Rent & Manage Delinquencies
Property managers collect rent, deposit checks and ensure the check clears. This includes handling collections and evictions, if necessary. Some managers can help facilitate this process by providing online payment options.
Reduce Managerial Expenses
New investors may wonder if their unit warrants the expense of a professional property manager. The real questions to ask are:
- Do you, as the owner, have the time required to manage the rental unit properly?
- Can the property owner respond around the clock if needed?
- What is your time worth?
Here's an example to help clarify this point:
If a dentist owns a property that needs to be painted and cleaned, it will cost about $1,500. Instead of hiring a property manager (who could have completed the task in several consecutive days), the dentist chose to complete the repair himself over four weekends– which essentially cost the dentist a month’s rent .
Professional property managers can help owners:
- Reduce costs from vacancies and potential legal fees
- Ensure maintenance is performed appropriately
- Offer peace of mind to an investor located a reasonable distance from the rental property
Like any other type of investment, an investment unit will benefit from a proactive professional manager, whether the owner lives 4 or 4,000 miles from the renal unit.